San Marino’s Grand and General Council on September 23 ratified Delegated Decree no. 115 of 2026 on the entry and stay of foreigners, according to media reports, adding amendments that rewrite the rules for residency on economic grounds and clarify how the republic’s 7% substitute tax for atypical residents applies.
The vote closed parliament’s September session after a preliminary debate that began the previous day.
San Marino, enclaved by Italy and outside both the EU and Schengen, offers foreigners four residency routes, each subject to Congress of State approval and an annual quota: elective residency through a €500,000 property purchase or €600,000 in government bonds, an atypical route for pensioners taxed at 6% on pension income, an atypical route for anyone else with foreign income taxed at a 7% substitute rate, and residency for economic reasons for entrepreneurs who own and run a local company.
The last two are what parliament amended this week. Under every route, residency consolidates into permanent status after ten years.
The 7% tax now applies regardless of treaty relief
For holders of atypical residency, the substitute tax on foreign-sourced income remains 7% of the netto frontiera, the amount left after foreign tax, with a floor of €10,000 (approximately $11,400) and a ceiling of €100,000 (approximately $114,000) per tax year.
The government’s amendment specifies that the tax is due even where a double-taxation treaty would otherwise leave that income untaxed in San Marino.
That reads as a technical fix, and Marco Mesina, an Italian tax attorney and founder of Move to Dolce Vita, treats it as one. In practice, he explains, the atypical regime “works as a flat price of entry”: a client pays 7% on foreign income, “never less than EUR 10,000 and never more than EUR 100,000 a year,” so the minimum applies to anyone with foreign income below roughly €143,000 and the cap to anyone above roughly €1.43 million.
Why make the minimum mandatory? Because the regime is elective, in Mesina’s view: “A client who opts in accepts the lump-sum logic, and San Marino is not taxing income it has given up under a treaty against the taxpayer’s will.”
He points to Italy’s own Article 24-bis lump sum and the 7% regime for pensioners as regimes that likewise “apply by choice and are not designed around treaty relief,” and describes the floor as protection against use “as a cheap residence certificate by people with little or no foreign income.”
Not everyone in the chamber was comfortable with the timing. Antonella Mularoni, a former foreign secretary and Captain Regent from the centrist opposition party Repubblica Futura, objected that a tax clarification of this weight arrived only at the ratification stage and urged the government to consult its own offices before issuing decrees.
Entrepreneur route eased to one hire, capped at 50
The larger rewrite came through a new Article 2-bis governing residency for economic reasons. Applicants must hold at least 51% of a San Marino company and guarantee only one full-time hire, post a €75,000 (approximately $85,500) guarantee in favor of the state that must reach €150,000 (approximately $171,000) within two years, achievable through a property purchase, and accept an annual cap of 50 new economic residencies.
Residency extends to a spouse, dependent children up to 25, and children with disabilities, while beneficiaries cover their own healthcare costs until the status consolidates after ten years.
Most of that framework predates this week. The previous rules already required a 51% shareholding and the €75,000-to-€150,000 guarantee, but demanded between one and three hires depending on the activity and obliged the company to take on a second worker by the third year.
That second-hire obligation is gone, and an amendment from Iro Belluzzi of Libera, a left-wing party in the governing coalition, allows the hire to be any San Marino resident rather than only a citizen.
For Mesina, the recalibrated requirements make the route “genuinely viable” for owner-managed businesses: “consultants, small trading or e-commerce companies, and professionals who can run a lean operation with one local hire.”
The guarantee is “a meaningful commitment but not prohibitive,” and the 50-a-year cap “signals selectivity rather than a mass-market product.”
His warning concerns the other side of the border. Italy’s residence rules look at physical presence and the center of personal and family life, so “San Marino companies run by people who in practice live in Rimini or elsewhere in Italy remain exposed to challenges on both individual residence and the company’s place of management.”
The route, he adds, “works well for those who genuinely relocate. It is not a paper solution.”
More reforms to come
Secretary of State Rossano Fabbri said the amendments fix problems created by years of overlapping laws, and that the bigger debate over who San Marino wants as residents will come later, when parliament debates the residency chapter of its EU association agreement.
Fabio Righi of Domani Motus Liberi, a center-right political party, pressed that point on the floor, asking whether the goal is more residents or qualified entrepreneurs and observing that the text names no preferred investments, turnover levels, or sectors.
An approved amendment requires that the Congress of State report to the Foreign Affairs Commission by January 31 and July 31 each year on residencies granted, after Fabbri acknowledged that the quarterly reporting the law already requires has in practice never arrived.
Mesina reads the whole exercise as “sensible housekeeping rather than a new strategy.” The more important conversation, “what profile of resident San Marino actually wants and how commitments are monitored, has been deferred to the broader reform linked to the EU association agreement,” and until then advisers will treat the framework “as stable in the short term but subject to review.”
It is the republic’s second adjustment to a residency route in 18 months, following the April 2025 tightening of income and asset requirements for foreign pensioners.
